When you prepare your U.S. individual income tax return (Form 1040), the first line you should fill out is “Wages, salaries, tips, etc.”. And it requires you to attach the Form W-2. What is form W-2 and how to read and understand the W-2? This article will give a brief guideline.Form W-2 is the annual "Wage and Tax Statement" that reports your taxable income from an employer to you and to the IRS.
Certain tax benefits, such as an advantageous filing status or certain tax credits on your U.S. individual income tax return, require either a qualifying child or qualifying relative. This article will introduce you to dependency definitions and related requirements.
Self-employment tax is a tax consisting of Social Security and Medicare taxes primarily for individuals who work for themselves. It is similar to the Social Security and Medicare taxes withheld from the pay of most wage earners.The self-employment tax rate is 15.3%. The rate consists of two parts: 12.4% for social security (old-age, survivors, and disability insurance) and 2.9% for Medicare (hospital insurance).
The Earned Income Tax Credit, EITC or EIC, is a benefit for working people with low to moderate income. To qualify, you must meet certain requirements and file a tax return, even if you do not owe any tax or are not required to file. EITC reduces the amount of tax you owe and may give you a refund.Those who qualify for EITC and claim the credits could pay less tax or even get a tax refund.
The gift tax applies to lifetime transfers of property from one person (the donor) to another person (the donee). A gift is made if tangible or intangible property (including money), the use of property, or the right to receive income from property is given without expecting to receive something of at least equal value in return. If something is sold for less than its full value
There are five different choices of filing status (The five filing statuses are: single, married filing jointly, married filing separately, head of household, and qualifying widow(er) with dependent child), but you can only choose one filing status on your tax return. If more than one filing status applies to you, you may choose the one that will result in the lowest amount of tax. Your filing status may change from year to year.
The Federal Insurance Contributions Act (FICA) provides for a federal system of old-age, survivors, disability, and hospital insurance. The old-age, survivors, and disability insurance part is financed by the social security tax. The hospital insurance part is financed by the Medicare tax. Generally, employer is required to withhold social security and Medicare taxes from employees' wages and pay the employer's share of these taxes.
Ohio located in the East North Central region of the United State. Ohio is the seventh most populous, and the tenth most densely populated in the country. The manufacturing sector is the largest industry in the state. The state's factories lead the nation in the production of plastics and rubber, fabricated metals, and electrical equipment and appliances. Ohio also is a leading producer of steel, autos, and trucks.
The state of Washington is a state in the Pacific Northwest region of the United States. Aerospace, agriculture and food manufacturing, clean technology, information and communication technology, forest products are the biggest industries in the State. The state of Washington has a business-friendly environment. Many big companies include Boeing, Microsoft, Amazon, Costco, and Nordstrom are located in Washington state.
The Volunteer Income Tax Assistance (VITA) program is an IRS initiative designed to support free tax preparation service in underserved communities for low-to-moderate income families. The following will briefly introduce the eligibility and procedures of VITA program. The VITA program offers free tax help to people who generally make $56,000 or less, persons with disabilities and limited English-speaking taxpayers who need assistance in preparing their own tax returns.